Introduction

Those entering into new construction contracts should include custom language addressing the parties’ respective rights and responsibilities related to COVID-19. Many articles and webinars have focused on how traditional contract clauses in existing contracts may respond to COVID-19 issues. The fit is not always clear. Some guesswork is involved and creativity is called upon as square pegs are coaxed into round holes. While there is a need to perform that retrospective analysis to assess how COVID-19 issues will play out under existing contracts, there is no need to propagate uncertainty in new contracts. Indeed, such uncertainty can cause parties to shy away from new contracts or include significant contingencies, neither of which supports an industry trying to recover from the pandemic.

This article addresses custom COVID-19 language for new construction contracts. The principles discussed can be applied to any construction contract. This article is based on two construction contracts for which I successfully drafted and negotiated custom COVID-19 language. One is a private project and the other is a public project. Some of the views expressed during those negotiations are weaved into the discussion to provide both sides’ perspective.
Continue Reading COVID-19 Language for New Construction Contracts: A Practical Approach

Force Majeure, Commercial Impracticability, and Frustration of Purpose

The outbreak of COVID-19 has been one of the most disruptive events to the global economy in recent memory. Businesses across every sector of the economy are scrambling to determine the legal repercussions of government travel restrictions, labor shortages, supply chain interruptions, financing impacts, and market price

The 2019 novel coronavirus and the disease it causes (“COVID-19”) is changing the landscape of construction projects across the country. COVID-19 orders from governors and other public officials are impacting projects by requiring new health initiatives, such as social distancing and the use of personal protective equipment, requiring residents to stay at home and self-quarantine

To help airport owners, design and engineering professionals, and the contractor community, ACI-NA, ACC, and AGC have teamed up to transform our Airport Construction Strategy Summit into a webinar series that is taking place April 14, April 28, May 12, and May 26. The COVID-19 pandemic has impacted a range of critical elements of project

Owners and contractors trying to understand the full impact of COVID-19 on their projects are likely turning to delay[1] or force majeure provisions in their construction contracts to assess their rights or liabilities for continued performance. An event of force majeure is a circumstance that prevents someone from fulfilling a contract, and many articles recently have been written addressing the contours of typical force majeure clauses.
Continue Reading Temporary Impracticality or Frustration of Construction Contracts During the COVID-19 Pandemic

This webinar provides a practical review of the impacts of COVID-19 on public and private construction contracts. Coverage includes the clauses covering delay, impact, acceleration, suspension of the work, changes and termination, whether express or constructive. The program focuses on the practical aspects of how best to manage the current situation, notice requirements, documenting claims,

With the exponential spread of COVID-19, owners, contractors, and design professionals are recognizing the substantial impact this pandemic will have on the construction industry. Several states issued shelter-in-place orders, resulting in the suspension of some construction work.[1] In some states, this has resulted in work stoppages on some of our nation’s largest infrastructure projects. The financial impact of these work stoppages will be significant. As a result, parties to construction agreements have looked to their force majeure clauses for guidance on how these issues should be addressed.
Continue Reading Coronavirus Pandemic: My Construction Agreement Has a Force Majeure Clause, So Now What?

Illinois Governor J.B. Pritzker issued a shelter-in-place Executive Order on March 20, 2020, the latest in a series of restrictive statewide actions that he has implemented in the effort to prevent further spread of COVID-19, commonly known as the coronavirus. Governor Pritzker’s Executive Order follows the imposition of statewide restrictions on the size of public gatherings, a suspension for bars and restaurants offering dine-in service, and school closures. It currently extends through April 7, 2020.
Continue Reading Illinois Governor Issues Shelter-in-Place Order in Response to the Coronavirus that Spares the Construction Industry

On March 13, 2020, President Trump declared a national emergency in response to the coronavirus (COVID-19) outbreak. Such a declaration has significant implications on the contracting community navigating the federal procurement process. While contractors are undoubtedly trying to manage existing contracts in light of labor and supply chain disruptions, many will be looking at the procurement landscape for business opportunities. Federal procurement law contains a number of provisions that authorize streamlined procurement procedures for major disasters or national emergencies. This article addresses the procedures that federal agencies may employ during a national emergency such as COVID-19. Because these procedures do not often look like typical procurement procedures, contractors should be mindful of the rules to better position themselves as they seek out opportunities.
Continue Reading Federal Procurement Procedures During a National Emergency

Globally, many developers and contractors are scrambling to identify available contractual relief as the Coronavirus (COVID-19) disrupts cross-border supply chains. US businesses will recall a similar effort just eighteen months ago, when the Trump Administration announced increased tariffs on $300 billion of Chinese goods. That trade war prompted  companies to scrutinize remedies and mitigate associated project risks by tapping alternative sources originating in other Asian countries and Canada. Once again, construction industry stakeholders should reexamine delay provisions in pending and future contracts to mitigate risks arising from project disruptions caused by COVID-19.

This article provides an overview of US case law interpreting the doctrine of force majeure in the context of disease-related delay claims. Drawing on that guidance, we then identify practical considerations for applying existing force majeure or related delay provisions and how they may be modified for future projects.
Continue Reading Managing Project Risk Associated with the Coronavirus Outbreak Through Force Majeure Provisions